City of Huntington Beach
Proposed FY 2022/23 Budget Adoption
City Council Public Hearing
June 7, 2022
Presentation Overview
• FY 2021/22 General Fund Budget Update
• Review of Budget Study Session Items
• Proposed FY 2022/23 General Fund Budget Review
• Proposed FY 2022/23 Capital Improvement Program Budget Review • Master Fee & Charges Schedule Review
• Next Steps - Approval of FY 2022/23 Budget Requested
2 FY 2021/22 General Fund
Budget Update
3 Economic Overview & Local Budgetary Impacts
• Economic trends indicate a continued economic recovery from the financial impacts of COVID‐19, but a recent decline in GDP signal caution U.S. real GDP increased 2.3% in Q3 2021, 6.9% in Q4 2021, ‐1.4% in Q1 2022 Slight decline in the last quarter due to Omicron restrictions in some parts of the country and a scale back of government assistance payments
According to UCLA Anderson Forecast (April 2022) – Orange County ‐ Labor markets and tourism is nearly restored to pre‐pandemic l evels and is expected to continue with a strong outlook
‐ Development surge is expected to continue
‐ Housing will face some headwinds due to recent steep price esc alation • As we emerge from the economic impacts of the pandemic, the City is monitoring recent developments in the economy:
Russia/Ukraine Crisis
Inflation & Prices
Supply Chain Challenges
Rising Interest Rates
Labor Shortages
4 City Budget & Fiscal Position
We are projecting a FY 21-22 surplus with modest surpluses over the next four years as a result of key financial decisions made by City Council and the ongoing recovery from the COVID-19 economic downturn. FY2021-22 is projected to conclude with a $3.4M surplus Historic Infrastructure Investments in FY2021-22
General Fund transfer to the Infrastructure Fund increased by 130% to $11.5M. CIP budget increased 57% to $39.3M
Additional One-Time Funding
City received $29.6M through the American Rescue Plan Act. City Council approved an expenditure plan to invest funds in projects. 5 Review of Budget Study
Session Items
6 Budget Study Session Held on May 17, 2022
7 • Key City Council identified budgetary adjustments to the proposed FY 2022/23 Budget from our Budget Study Session included the following:
1) American Rescue Plan Act – Administrative Change
2) Review of Projects Requiring Additional Funding – Set-Asides and Project Priorities 3) Circuit Ride Share Program – Continue Program
American Rescue Plan Act
8 • The $1.9 trillion American Rescue Plan Act (ARPA) delivered $350 billion to state, local, territorial, and tribal governments in response to COVID-19.
• Huntington Beach will be receiving $29.6 million, split into two equal payments:
‒ $14.8 million was received in May 2021
‒ $14.8 million allocation payment is expected in June 2022 • On September 7, 2021, City Council approved an ARPA spending plan. • Under ARPA guidelines, the City has identified $52.7 million in lost revenue allowing the City broad latitude to deploy the funds for governmental services. • Recent efforts on the Federal level have been made to claw back unspent ARPA payments. Those efforts were unsuccessful.
• Based on Council feedback, the ARPA funds is allocated to eligible police and fire personnel costs in the proposed FY 2022/23 Budget to minimize the risk of future claw back efforts. • General Fund budget savings will be available to fund a newly established Huntington Beach Recovery Reserve to accomplish City Council’s priorities approved on September 7, 2021.
Review of Projects Requiring Additional Funding
9 • The projects listed above in most cases cover only the planning phase and will require additional funding for the construction phase of the project.
* Included in FY2022/23 Proposed Budget
^ Funded in Prior Fiscal Year
Description
Funding
Source
Amount
Funded
Est. Add’l
Project Cost
Possible
Funding
Downtown Revitalization Improvements*
ARPA / HB Recovery
$1.75M $8.2M-$17.3M General
Oak View Library/Community Center Rehabilitation* $2M $15M-$20M Grants/Public
Private
Partnership
Comprehensive Homeless Response Plan Implementation /
Healing Center $2.5M $50M-$80M
Grants/Housing
Permanent Supportive Housing / Healing Center $2.5M
Combine with
Healing Center Grants/Housing
Carr Park Improvements* $355K $3.6M
Future Park
DIF/Grants
World Skatepark Development* $750K TBD
Public Private
Partnership
Major City Facility Upgrade Project $3.2M TBD
Public Private
Partnership
Edison Park Improvements*
CIP
$475K TBD
Future Park
DIF/Grants
Huntington Beach Blufftop Stabilization^ $400K $1M-$1.5M Grants Oil Well Abandonment*^ $500K TBD General
Possible Funding Sources for Projects
10 • Possible Funding Sources for these projects include:
– Strategic Initiatives Reserves $16.5M (General Fund) – Proceeds from Prior City Manager Housing Agreement of $1.66M (General Fund) – CA Superior Court decision in fa vor of the City related to the dissolution of former RDA $5.2M ($1.5M GF, $3.7M Housing Fund) – Unallocated funds originally allo cated to the Talbert Channel Trail Project $272K (HB Recovery) – State and Federal Grants for Oak View, Healing Center/Permanent Supportive Housing, Blufftop, and Park Projects – Future Park Development Impact Fee Funding
– Public and Private Partnerships
• $19.7M General Fund, $3.7M Housing Funds, and $272K HB Recovery Funds • $78M‐$122M of estimated cost of projects with 4 capital projects with undetermined costs • Based on City Council feedback:
– Set‐aside proceeds from City Manager Housing Agreement $1.66M, and RDA legal proceeds $1.5M in the Strategic Initiative Reserve to fund City Council priorities – total Strategic Initiative Reserve $19.7M –S e t ‐ a s i d e $3.7M in Housing Funds for the Healing Center – Funding priorities will be discu ssed further next fiscal year, but Council expressed strong interest in prioritizing the Downtown Revitalization Improvements and Healing Center Projects – General Fund surplus set‐aside in reserves based on the City’s Financial Policy (Pension Rate Stabilization, Economic Uncertainties, Infrastructure and Capital Reserves)
Circuit Ride Share Program
11 • On July 13, 2021, the City launched a Circuit Pilot Program which provides free rides to visitors and residents within Downtown Huntington Beach using the Ride Circuit app
• The pilot program ends on June 30, 2022
• 4-5 HB Circuit all-electric, low-speed, six-seat golf carts Based on 9 Months of Service:
Monthly ridership range – 6,910 to 10,614
Average monthly ridership ‐ 8,619
Average wait time ‐ 7:44 minutes
Survey Summary from December 2021 – March 2022
Responses from 742 riders:
• 678 (91%) are HB residents
• 728 (98%) want to keep this service
• 605 (82%) used the service to visit local restaurants and businesses
• Most common response was “it’s free and electric”
Circuit Ride Share Program
12 • City will seek to offset costs by pursuing grant funding, private sponsorship, and advertising revenue
• Based on Council feedback, $350K is included in the FY22/23 Proposed Budget to fund the Circuit Ride Share Program
Total Contract Cost: $474,000
Total Cost to the City: $350,000
Proposed FY 2022-23
General Fund Budget Review
13 FY 2022/23 General Fund Proposed Budget with Changes 14 • Proposed FY 2022/23 General Fund Budget based on feedback from City Council Study Session is structurally balanced, with a projected $690K surplus General Fund (Fund 100)
(in thousands)
Proposed
FY22/23
Revenues (Recurring) $253,552
ARPA Funds 29,607
Total Revenues 283,159
Personnel Costs 169,892
Operating Costs 48,567
Non-Operating Costs 34,403
HB Recovery Projects 16,135
Total Expenditures 268,997
HB Recovery Reserves 13,472
Surplus $690
• Continued Infrastructure Investments in
FY2022/23
General Fund transfer to the Infrastructure
Fund increased by 17% to $13.5M
CIP budget increased 52% to $59.7M
FY 2022/23 General Fund Proposed Revenues - $283.2M
Property Tax
34.7%
Sales Tax
18.8%
Franchises
3.0%
Transient Occupancy Tax
5.1%
Utility Users Tax
6.5%
License & Permits
2.9%
Fines & Forfeitures
1.6%
Use of Money & Property
6.0%
Revenue from Other
Agencies
1.0%
Charges for Current
Services
9.2%
Other Revenue
0.6%
Non‐Operating Revenue
10.6%
15 FY 2022/23 General Fund Budget Revenues - $283.2M
• General Fund revenues anticipated to increase by $37.9 million ($8.3M + $29.6M ARPA) 16 $236.0
$225.2
$237.0
$245.3
$283.2
$150
$170
$190
$210
$230
$250
$270
$290
FY18/19 Actual Pre‐COVID FY19/20 Actual FY20/21 Actual FY21/22 Pro jected FY22/23 Proposed FY 2022/23 General Fund Budget Revenues
• Major revenue variances include:
Property Tax: $98.3 million (5.7% or $5.3 million increase) - Higher assessed valuations as of January 1, 2022 versus prior fiscal year Sales Tax: $53.3 million (2.1% or $1.1 million increase) - Increase due to strong consumer demand across all industry groups and increased prices Transient Occupancy Tax: $14.5 million (8.2% or $1.1 million increase) - Reduced travel restrictions expected to fuel increased local tourism to Huntington Beach, exceeding pre-COVID-19 revenues of $14 million in FY2018/19 Revenue from Other Agencies: $2.7 million (-26.7% or $1 million decrease) - Strike team reimbursements are not included in the FY2022/23 budget, but are included in the FY2021/22 projected revenues
Charges for Current Services: $26 million (4.9% or $1.2 million increase) - Primarily attributed to increases in Emergency Medical Services Transports and Billing Rates Non-Operating Revenue: $30.1 million (6,638% or $29.6 million increase) - Recognition of ARPA revenues
17 FY 2022/23 General Fund Proposed Revenues
18 (in thousands)
Projected
Revenues
FY2021/22
Proposed
Revenues
FY2022/23
Increase/
(Decrease)
% Increase/
(Decrease)
Property Tax 92,938 98,259 5,321 5.7%
Sales Tax 52,265 53,343 1,079 2.1%
Franchises 8,536 8,604 68 0.8%
Transient Occupancy Tax 13,371 14,471 1,100 8.2%
Utility Users Tax 18,457 18,457 - 0.0%
License & Permits 8 ,016 8,201 185 2.3%
Fines & Forfeitures 4,516 4,534 18 0.4%
Use of Money & Property 16,807 16,887 80 0.5%
Revenue from Other Agencies 3,712 2,721 (990) -26.7%
Charges for Current Services 24,820 26,026 1,207 4.9%
Other Revenue 1,368 1,604 235 17.2%
Non-Operating Revenue 446 30,051 29,605 6,637.9%
Total 245,251 283,159 37,908 15.5%
FY 2022/23 General Fund Proposed Expenditures - $269.0M * Transfers include Infrastructure, Equipment, General Liability & Section 115 Trust Transfers, HB Recovery
** Other includes City Council, City Manager,
City Attorney, City Clerk, and City Treasurer
19 Personnel
Services
58.2%Operating
Expenses
17.9%
Debt Service
7.0%
Transfers*
16.9%
USES OF FUNDS
Other**
3.0%
Administrative
Services
3.8%
Community
Development
3.8%
Community &
Library Services
5.4%
Finance
2.4%
Fire
19.5%
Non‐Departmental
24.4%
Police
29.9%
Public Works
8.0%
BY DEPARTMENT
Recommended FY 2022/23 Authorized Positions
• Staff is proposing 4 new General Fund positions in the FY 2022/23 Budget:
City Clerk Department
‒ (1) Records Specialist to manage public records requests City Manager Department
‒ (1) Executive Assistant to provide administrative support to the City Manager and Assistant City Manager – restore eliminated position
‒ (1) Social Worker to assist with the growing Homeless caseload within the Homeless and Behavioral Health Division
‒ Transfer non-sworn Homeless and Behavioral staff from the Police Department to the City Manager’s Office
Finance Department
‒ (1) Accounting Technician II to process accounts payable invoices and serve as a concierge at City Hall – partially restore accounts payable position eliminated as part of SIP
20 Recommended FY 2022/23 Authorized Positions
• Staff is proposing a net addition of 5 Other Fund positions in the FY 2022/23 Budget:
Public Works Department
Position Reductions (3)
‒ Eliminate (2) Water Meter Readers and (1) Water Meter Repair Technician due to implementation of the Automated Water Meter Infrastructure.
Position Additions (7)
‒ Add (1) Field Service Representative, (1) Water Distribution Maintenance Leadworker, (1) Water Equipment Operator, (1) Water Systems Technician III, and (1) Water Utility Locator to enhance water system maintenance, focus on air quality mandates and Water Production and Flood Control reporting, and address the high volume of service requests.
‒ (1) Traffic Maintenance Service Worker to improve traffic signal maintenance response ‒ (1) Contract Administrator to administer construction contracts within the approved Capital Improvement Program (CIP)
Finance Department
‒ (1) Senior Accounting Technician in the Finance Department to provide customer service, billing, and system maintenance and implementation support for the City’s municipal services team (water, sewer, and trash)
21 FY 2022/23 Full Time Equivalent – All Funds
Pre‐COVID
22 Pension Update
• March 2021, City Council approved refinancing 85% of our pre‐existing pension debt at a historically low interest rate of 2.925% allowing the City to save $166.7 million during the next 24‐year period
• HB’s annual pension payments are anticipated to be up to $17.4M less than if we did not refinance
• FY22/23 Pension Payment $28M vs. $37.7M yielding $9.7M Savings • CalPERS return in FY20/21 was 21.3%:
CalPERS Funding level 102.8% vs. 76.7% funded
No UAL payment required in FY23/24
• Refinancing will be the better option as long as in the long term CalPERS is able to maintain a market rate of return greater than 2.925% (CalPERS target 6.8%) • As part of our pension debt refinancing plan, the City also adopted an Unfunded Accrued Liability Pension Funding Policy mandating that we set‐aside additional funds to payoff any new future pension debt
• A $1.4 million transfer is included in the proposed FY 2022/23 budget to prefund pension liabilities via our Section 115 Trust 23 Pension Payment Comparison with and without Refinancing 24 FY 21/22 FY 22/23 FY 23/ 24 FY 24/25 FY 25/26 FY 26/27 FY 27/28 FY 28/2 9F Y 2 9 / 3 0F Y 3 0 / 3 1 UAL 5,471,553 5,471,553 0 5,471,553 5,471,553 5,471,553 5,471,553 5,471,55 3 5,471,553 5,471,553 POB 22,571,894 22,571,365 22,569,834 22 ,576,076 22,569,314 22,573,775 22, 568,519 22,571,680 22,570,145 22,570,992 UAL
w/o POB $34,914,927 $37,718,694 $39,496,628 $41,460,002 $40,678,545 $41,846, 298 $43,012,009 $43,045,744 $44,244,443 45,476,104 0 5
10 15
20 25
30 35
40 45
50 Millions
Pension Payment Amounts
FY 2021/22 ‐ FY 2030/31
No UAL
21.3% CalPERS
Return FY20/21
Future UAL payments dependent on CalPERS return
Financial Outlook
25 *Includes Debt Service, Capital Expenditures, and Transfers General Fund (Fund 100)
(in thousands)
Projected
FY21/22
Projected
FY22/23
Projected
FY23/24
Projected
FY24/25
Projected
FY25/26
Revenue (Recurring) $245,251 $253,552 $257,487 $261,997 $266,605 ARPA Funds 29,607
Total Revenues 245,251 283,159 257,487 261,997 266,605
Personnel Costs 164,431 169,892 171,090 173,566 176,032 Operating Costs 43,658 48,567 49,979 51,456 52,960
Non-Operating Costs* 33,767 34,403 35,735 36,339 36,991 HB Recovery Projects 16,135
Total Expenditures 241,856 268,997 256,804 261,361 265,983 HB Recovery Reserves 13,472
Surplus $3,395 $690 $683 $636 $622
FY 2022/2023
Capital Improvement
Program (CIP) Review
26 FY 22/23 CIP BUDGET
Budget
New Appropriations: $ 60 M ($25M 2 yrs ago) Continuing Appropriations: $ 6 M
Total $ 66 M
Funding sources proposed:
General/Infrastructure Fund
Enterprise Funds (Water and Sewer)
Special Revenue Funds (Measure M, Gas Tax, Prop 42, RMRA, AQMD, PEG, Park & PD DIF, Quimby)
Grants (CDBG, Prop 68)
27 CIP FUNDING SOURCES
28 DRAINAGE $12.8M
• Heil Avenue Storm Water Pump Station $11M
• Repairs to Channel C6 SC1 $120k
• Storm Drain PS Building Improvements $300k
• Storm Drain PS Forebay Improvements $300k
• Half Round Grates $300k
• McCallen Storm Drain Trash Removal $810k
29 FACILITIES $10.4M
• Joint Youth Training Center $2M
• Central Library Children-Teen Concept Plan $350k
• Oak View Community Center Rehab $2M
• Civic Center UST Replacement $1.2M
• Civic Center Generator and Main Switchgear $1.4M
• Roof Replacement City Yard Bldg “A” $155k
• City Hall Space Planning and Office Improvements $158k 30 FACILITIES (Cont.)
• PD Heliport Hangar (Design) $200k
• PD Comm. Center Remodel $1.2M
• PD Traffic Office Remodel $415k
• PD Women’s Locker Room (Design) $145k
• Replace R22 AC Equipment $165k
• World Skatepark Development Planning $750k
• Oil Production Abandonment $250k
31 NEIGHBORHOOD $4.2M
• Residential Curb Ramps $665k
• Residential Overlay $3.5M
32 Zone 2
PARKS AND BEACHES $3.2M
• Huntington Bluffs Stabilization Project $400k
• Carr Park Improvements (Design) $355k
• Edison Park Reconfiguration (Design) $475k
• Sports Complex LED Lighting Retrofit $430k
• Huntington Central Park Slater Playground Equipment $475k • Marina Park Reconfiguration (Design) $440k
• Pattinson Park Playground/Picnic Area Improvements $625k 33 SEWER IMPROVEMENTS $8.2M
• Sewer Lift Station Improvements $4.9M
• Sewer Lining – Various Locations $1.4M
• Edinger Sewer, Murdy Channel $1.9M
34 STREETS & TRANSPORTATION (CONT.)
35 *
STREETS & TRANSPORTATION $17.5M
• Arterial Rehabilitation $6.2M
• Arterial Beautification $1M
• Downtown Revitalization Improvements $1.8M
• Downtown Street Lighting $650k
• Fiber Optic Projects $1.1M
(Garfield, Gothard, Central Library, Bella Terra PD Substation) 36 Arterial Rehab – Before Arterial Rehab – After
STREETS & TRANSPORTATION (CONT.)
• Heil Fire Station Signal Improvements $290k
• TS Synchronization – Bolsa $20k
• Bridge Preventive Maintenance Program $500k
• Bridge Rehabilitation $3.8M
• Goldenwest Median Turf Replacement $175k
• Citywide Mobility and Corridor Improvements $2M
37 WATER IMPROVEMENTS $3.3M
• Water Well No. 9 Roof Redesign Project $468k
• Water Well No. 4 Facility Upgrades $1.5M
• Water Main Replacement Projects $1.25M
• Water Production Building Rehabilitation $83k
38 Master Fee and Charges
Schedule Review
39 • March 1, 2022 - City Council directed staff to review the Master Fees and Charges Schedule and review the results with the Finance Commission for recommendation prior to City Council Consideration.
• March to May - Finance staff worked with the City’s fee consultant and other departments to develop recommended fee adjustments based on CPI adjustments and market rate analysis • May 25, 2022 – After extensive review and discussion, Finance Commission voted to recommend staff’s proposed fee adjustments with modifications to City Council • June 7, 2022 – Review fee adjustment recommendations with City Council for consideration 40 Background
• The City maintains a Master Fee and Charges Schedule identifyi ng applicable fees and charges for various City service
• Fees are reviewed and updated periodically
The City last completed a comprehensive fee study in 2016 based on FY 2014/15 budget and financial data
Since then, certain fees were added to implement new programs (e.g., Air Show, Short-Term Rentals) or changed based on market analysis and department feedback • Communities primarily use tax revenues to fund services that p rovide community-wide benefits.
Public Works, Public Safety, Park maintenance
• Communities use fees and charges (direct recovery) to fund ser vices that provide a direct benefit, such as:
Plan review, Permitting, Inspection
Background
41 Background
• Since 2016, regional inflation has increased by 19%
• Cities throughout the State face inflationary pressures for la bor-related and operating costs
California minimum wage has increased by 50% since 2016 Insurance and utility costs continue to rise
• A best practice in government finance is for cities to perform a comprehensive fee study update every three to five years
• For FY 2022-23, staff recommends adjusting most development an d operational permit fees by 5.93%
• Minimal inflationary adjustments are proposed for Library and Community Services hourly rates only
• Non-inflationary changes to certain department fees are also p roposed 42 Municipal Fees in California
• Why do cities charge fees for services?
To recover costs for services provided to individuals for which there is no benefit to the greater general public
Enable continuity of service levels by improving cost recovery levels • Periodic reviews ensure user and regulatory fees are set accor ding to the costs of service
User fees must be linked to and not exceed the estimated reasonable cost of service • The full cost of services sets the maximum limit of a cost-based fee Direct program costs for labor, services, and supplies Facilities overhead
Departmental administration
Citywide administration and central support services
• Generally, fees from users of one program may not be used to p ay for costs incurred to serve users of a different program
43 Cost of Service
Fully Burdened Hourly Estimated or Known Maximum Fee Amount Rates: Times for Providing
• Direct and indirect labor Services
costs
• Services and supplies
• Agency Overhead
44 Cost of Service
The program’s full cost of service that is supported by other City’s revenue sources (typically the General Fund)
45 Fee Recommendations
46 Proposed Fee Schedule Updates for FY 2022/23
• Update fees by 5.93% to adjust for inflation
This adjustment is significantly less than the change in CPI of 19% (2016-2021) Projected reduced General Fund subsidy: $301K
• Other refinements to the Master Fee and Charges Schedule to be tter align certain fees and charges with services provided
• Finance Commission voted to recommend the Proposed Fee Schedule with Commission’s modifications on May 25, 2022 47 Fee Schedule Update – Fire
Proposed Change – Restructure Fire/Life Safety Inspection Fees • Implement a new self-inspection fee (F-99) for extra-low risk occupancies • A nominal fee of $15 would be charged to cover the cost of man aging the program • Approximately 2,100 businesses would be eligible to participat e • Streamline the fee schedule for fire and life safety inspectio ns and change fee to include one inspection and charge for re-inspections
• The transition to select low-risk self-inspections would allow Fire staff to focus more time on other critical duties such as fire suppression response training, pre-planning to map hazards and risks, and community risk reduction • Realigning the program would result in an estimated $1,900 dec rease in cost recovery
48 Fee Schedule Update – Fire
Proposed Change – Restructure Fire/Life Safety Inspection Fees (continued) • Add a fee (F-262) for late submission of Inspection, Test, and Maintenance (ITM) reports to increase the compliance rate for fire system maintenance ($15/month) • Businesses will receive automated notifications beginning 30 d ays in advance of the due date and the late fee will be assessed once the report is 90 days overdue • A similar fee is assessed for annual Hazardous Material Busine ss Plan submissions, which has resulted in a 95% compliance rate • Currently, 42% of businesses have overdue ITM reports • The fee is expected to increase compliance to 95% and provide annual increased fee recovery of $24,900
49 Fee Schedule Update – Fire
Proposed Change – Restructure Fire/Life Safety Inspection Fees (continued) • Minor revisions to Central Net Training Center User Fees are also proposed to align fees with training programs administered at the Center • Reduction in fees for residents and non-residents for the Junior Lifeguard program are also proposed
Description Fee Description Fee
F‐99 Up to 750 sq. ft 72 $ F‐99 Self‐inspection Report 15 $ F‐100 751 ‐ 2,500 sq. ft 108 F‐100 Up to 2,000 sq. ft. 108 F‐101 2,501 ‐ 5,000 sq. ft. 200 F‐101 2,001 ‐ 10,000 sq. ft. 280 F‐102 5,001 ‐ 25,000 sq. ft. 320 F‐102 Over 10,000 sq. ft. 400 F‐103 25,001 ‐ 50,000 sq. ft. 563 F‐262 ITM Late Fee (per month) 15 F‐104 Over 50,000 sq. ft. 724
F‐105 Repeat inspection//violation notice 80 F‐121 7 Stories (base fees) Actual Cost* F‐122 Per floor above 7 stories Actual Cost*
F‐121 7 Stories (base fees) 2,900
F‐122 Per floor above 7 stories 223 F‐142 Resident Fees Charged 556 F‐143 Non‐Resident Fees Charged 583
F‐142 Resident Fees Charged 605 F‐143.3 Sand Crab (resident and non‐resident) 159 F‐143 Non‐Resident Fees Charged 635 * F‐252 Fire Prevention Hourly Rate F‐143.3 Sand Crab (resident and non‐resident) 150
Junior Lifeguard Program Fees
Junior Lifeguard Program Fees
Proposed Fee ScheduleCurrent Fee Schedule
High Rise Inspections
High Rise Inspections
50 Fee Schedule Update – Public Works
Proposed Changes
• Revise the Fire Hydrant Flow Analysis fee (PW-9) from a deposi t-based fee to actual hourly rate
• This administrative change would reduce the number of refunds issued • Hourly Rate for the Engineering division (PW-77) would be used to calculate the fee
• Revise Utility Company Encroac hment Permit fee (PW-22) to eliminate the “Encroachment Permit Expired” fee of $119
• No longer applicable as the permit may be continuously renewed as long as the license and insurance remains current
• Proposed revisions are administrative only (cost neutral) 51 Fee Schedule Update – Community
Development
Proposed Change – Eliminate Outdoor Dining Fees PL 106 & 107 • License Agreement Use Charge (PL 106) is considered “rent,” no t a fee • Current annual rate of $0.01/sq ft was set in the 1990s and is well below market rates
• Similar fees charged by other coastal cities are location-base d and range from $1-7.05/sq ft per month
• Rent charges will be brought to City Council at a future date to set rent charges to be included in License Agreements
• Fee is unrelated to the Temporary Emergency Use Permit establi shed during the COVID-19 pandemic for the City’s Open Air Dining Program 52 Fee Schedule Update – Community
Development
Proposed Change – Eliminate License Agreement Code Enforcement Fee (PL 107) • License Agreement Code Enforcement Fee (PL 107) is used for complaint-driven inspections
• Current rate is $4/sq ft
• Utilizing established Code Enforcement fees (CE-10 to CE-14) w ill more accurately cover staff time to review and investigate complaints
53 Fee Schedule Update – Community
Development
Proposed Change – Revise Building Inspection Fees
• Plan check consultants charge the City a percentage of the pla n check fee (~70%) • Consultants have noted the cost spent on plan review far excee ds the fee collected • Current fees are significantly lower than comparable surroundi ng cities Building Inspection
Fees (B‐2)
Planning Plan Check
Fees (PL‐95)*
Building Plan Check
Fees (B‐3)** Total
Huntington Beach (current) 2,164$ 995 $ 1,320$ 4,479$ Anaheim 1,580 323 2,577 4,480 Huntington Beach (proposed) 2,400 1,104 1,464 4,968 Long Beach 3,039 900 1,520 5,459 Costa Mesa 3,463 N/A 2,251 5,714 Newport Beach 3,648 520 2,837 7,005 County of Orange 5,490 N/A 3,569 9,059 * 46% of total Building Inspection Fee (B‐2) ** 61% of t otal Building Inspection Fee (B‐2) EXAMPLE: Fees for 2,500 sq ft Building valued at $300,000 54 Fee Schedule Update – Community
Development
Proposed Change – Revise Building Inspection Fees
• Projected Annual Increased Cost Recovery: $324,000
Building Inspection
Fees (B‐2)
Planning Plan Check
Fees (PL‐95)*
Building Plan Check
Fees (B‐3)** Total
Huntington Beach (current) 295 $ 180 $ 136 $ 611$ Huntington Beach (proposed) 404 186 246 836 County of Orange 508 N/A 330 838 Costa Mesa 703 N/A 268 971 Long Beach 450 310 225 985 Anaheim 572 323 351 1,246 Newport Beach 836 208 642 1,686 * 46% of total Building Inspection Fee (B‐2) ** 61% of t otal Building Inspection Fee (B‐2) EXAMPLE: Fees for Building valued at $2,001 ‐ $25,000
55 Fee Schedule Update – Community &
Library Services
Proposed Change – Revisions to Facilities Cancellation Fee, Camp HB, and Senior Outreach Center
• Facility Reservation Cancellation Fee: $10 to $25
• Senior Outreach Center: added rental rates for Residents, Non- Residents, and Commercial categories in preparation of the facility opening • Adjustments to Camp Charges
• Camp HB: Proposed increase from $175/week to $180-200/week • Fees for similar programs offered by Costa Mesa and Irvine are $220 and $249 per week
• Addition of Camp HB Extended Hours charge: $35-50/week • The proposed ranges would phase in over multiple years • Proposed changes would take effect beginning Summer 2023 • Projected Annual Increased Cost Recovery: $9,000
56 Fee Schedule Update – Community &
Library Services
Proposed Change – SANDS CLS Services Guide Advertising Rates • Advertising rates were last adjusted in 2016
• Proposed rates would offset increased color printing costs • Projected Annual Increased Cost Recovery: $10,000
Description Current Proposed
Back Cover 3,500 $ No change
Inside Front Cover ‐ full page 3,200 No change Inside Back Cover ‐ full page 2,800 3,200 Full Interior 2,000 3,000
1/2 page 1,200 1,500
1/4 page 800 1,000
1/2 page (B & W, Horizontal) 800
1/4 page (B & W, Vertical) 500
Inside Front Cover ‐ 1/2 page N/A 1,600 NEW Inside Back Cover ‐ 1/2 page N/A 1,600 NEW 57 Fee Schedule Update – Community &
Library Services
Proposed Change – Sunset Vista RV Campground Daily Rates • Adjust rates to reflect increased demand on weekends and holidays • Holidays: week of Thanksgiving and Christmas, Veterans Day, Martin Luther King Jr.
Day, Presidents Day, and Memorial Day
• Modify the existing Reservation Cancellation Fee of $25 for cancellations less than 30 days to 2-day notification to align with other campground standards • Addition of Site Lock Fee of $5/night
• Allows campers to lock their space for best view or to be near family/friends for an improved camping experience
• Facility Improvements: lot repaved as part of the FY 2021/22 CIP, new electrical hookups, Wi-Fi access
• New, user-friendly reservation system to be implemented in July 2022 58 Fee Schedule Update – Community &
Library Services
Proposed Change – Sunset Vista RV Campground Daily Rates Current Proposed
Recreational Vehicle (RV) plus Auto $70/day $75/day Sun‐Thurs $85/day Fri & Sat/Holidays*
Senior (62+) $60/day $65/day Sun‐Thurs
$75/day Fri & Sat/Holidays*
With Disabled Person (DP) Placard $60/day $65/day Sun‐Thurs $75/day Fri & Sat/Holidays*
Reservation Cancellation Fee (>2 days prior to arrival date) N/A 25$ NEW Reservation Cancellation Fee (2 or less days prior to arrival date) N/A First Night's Daily Rate NEW Reservation Fee 10$
Reservation Cancellation Fee 25$
(for cancellations less than 30 days)
Space Lock Fee N/A $5/day NEW
*Holiday Rates
Thanksgiving Week (Sunday preceding Thanksgiving through Saturd ay night following Thanksgiving) Christmas Week (day preceding Christmas through New Year's Eve) Day preceding Veterans Day (observed), Martin Luther King Jr. D ay, Presidents Day, Memorial Day Sunset Vista Daily Rates Winter Camping (Oct 1 ‐ May 31) • Projected Annual Increased Cost Recovery: $73,000 59
Fee Schedule Update – Summary
Summary of Proposed Changes to the Master Fee and Charges Schedule (by Department)
• 43% of total fees are adjusted for inflation, and have not bee n adjusted since the adoption of the Fee Schedule in 2016
• 52% of total fees will remain unchanged
Department Inflationary
Adjustments
Non-CPI
Adjustme nts* New Fees Reduced Fees Fees Remaining
Unchanged
Total by
Department
City Clerk 2 - - - 6 8
City Manager 24 - - - 5 29
Community & Library Services 3 10 11 - 374 398
Community Development 203 8 - 2 54 267
Finance 42 1 - - 17 60
Fire 145 16 9 2 89 261
I n f o r m a t i o n S e r v i c e s ----1 1
Police 12 - - - 30 42
Public Works 73 1 - - 27 101
Total 504 36 20 4 603 1167
* Includes recalibration, restructure, pass-through, and market rate adjustment. 60 Fee Schedule Update – Summary
Summary of Proposed Changes to the Master Fee and Charges Schedule (by Typical Fee Payer Category)
• The fees paid by developers, contracts, businesses, or homeown ers with proposed adjustments are primarily building and planning fees for permitting of new construction or modifications to existing structures Typical Fee Payer Inflationary
Adjustments
Non-CPI
Adjustm e nts* New Fees Reduced Fees Fees Remaining
Unchanged
Total by
Fee Payer
Business or Organization 108 10 4 - 90 212
Business or Individual 4 - - 3 7
Business or Other Public Agency - 10 8 - 65 83
D e v e l o p e r ----1 1
Developer, Contractor, Business, or Individual 335 9 - 2 71 417 D e v e l o p e r , C o n t r a c t o r , o r B u s i n e s s 2 9 ---- 29 I n d i v i d u a l 9572 2 2 7 250
I n d i v i d u a l o r B u s i n e s s ---- 1 2 12
Individual or Organization 16 1 - - 34 51
Individual, Organization, or Business - 1 1 - 26 28
O r g a n i z a t i o n ---- 7 3 73
Other Public Agency 3 - - - 1 4
Total 504 36 20 4 603 1167
* Includes recalibration, restructure, pass-through, and market rate adjustment. 61 Fee Schedule Update – Summary
Department
Decrease in City
Fee Subsidy
CPI Adjustment of 5.93% 301,000 $
Fire 23,000
Community Development 324,000
Community & Library Services ‐ Programs 9,000
Community & Library Services ‐ SANDS 10,000
Community & Library Services ‐ Sunset Vista 73,000
Total Estimated General Fund Savings 740,000 $
Proposed Master Fee and Charges Summary
• The intent of these adjustments is to reflect the gradual increase of costs due to inflationary pressures.
• If the Master Fee and Charges Schedule is amended as proposed, General Fund expenditures subsidizing these fees would decrease by $740,000 and provide a corresponding increase in available discretionary General Fund revenue to be used for capital projects, equipment, and other City Council priorities. 62 Fee Schedule Request for Council Direction
63 • Request for Council direction on the Proposed Fee Schedule recommended by Finance Commission. Options include the following:
1. Approve the Proposed Fee Schedule recommended by Finance Commission
2. Approve the Proposed Fee Schedule recommended by Finance Commission with City Council modifications
3. Do not approve changes to the Fee Schedule at this time • If approved, the proposed fee adjustments for Community and Library Services would take effect July 1, 2022. All other proposed fee adjustments would be effective August 8, 2022.
• FY2022/23 Proposed Budget does not include the $740K recommended updates to the Fee Schedule
Next Steps -
Approval of FY 2022/23
Budget Requested
64 City Council Approval Requested
65 • City Council approval of the proposed FY 2022/23 budget is requested • Key budget components include:
1) Structurally balanced FY 2022/23 spending plan - $690K General Fund surplus 2) Continued investment in infrastructure
– General Fund transfer to the Infrastructure Fund increased by 17% to $13.5M – CIP budget increased 52% to $59.7M
3) American Rescue Plan Act – administrative change
4) Set-aside $1.66M CM Housing Agreement & $1.5M RDA legal proceeds in Strategic Initiative Reserves 5) Set-aside $3.7M RDA legal proceeds in Housing Funds for the Healing Center 6) Circuit Ride Share Program – continue program
– $350K is included in the FY22/23 Proposed Budget to fund the Circuit Ride Share Program 7) Master Fee and Charges Adjustments
– Finance Commission proposed fee adjustments would increase cost recovery by $740K